Hardware shortages are a no-brainer, but in the case of AMD, the growing popularity of its APUs and CPUs in recent years has resulted in demand far exceeding the manufacturing capacity allocated to TSMC. So that the same does not happen to them again, AMD has already taken steps in this area.
AMD secures space on TSMC N5 and N3 nodes
The last time we know about the future AMD is that its future Zen 5 architecture will be codenamed “Granite Ridge”, while the APU will be codenamed “Strix Point”. Which manufacturing node AMD will use for Zen 5? We know that this will be TSMC’s N3 or 3nm node. But before all this we will see the launch of Zen 4 under the N5 or 5nm node of TSMC.
Since the chip makers like TSMC in the background operate like a printing house and have a certain number of wafers they can make per month for AMD, it is important not only to develop new chips under the new ones. manufacturing nodes, but also to ensure a good part of the manufacturing volume. This is what they did and therefore AMD has already reserved a large portion of TSMC’s N5 and N3 production capacity for the next several years.
What does it mean? Well, AMD has already paid a large amount of money up front to have the Ryzen and Radeon CPUs that will be released in the following years printed on TSMC wafers. Decision that could be influenced by a potential shortage of stock of some APUs, CPUs and SoCs due to not reserving in advance.
This will mean a price hike for AMD
When a new manufacturing node is deployed, its development cost is very high, and it gets higher and higher, as the first customers of that node are the ones who end up paying a higher price per wafer. Currently, it is Apple that usually starts TSMC nodes, the reason? Their high margins allow them to overpay for foundry wafers and secure their use before anyone else.
TSMC is playing with the needs of its various customers and it is quite possible that AMD was able to make TSMC’s N5 and N3 node wafers cost AMD more in the process of producing their chips. . This will clearly affect the price increase for AMD branded hardware in the future.
The downside to this will be that AMD may have more inventory in the market than it currently has, this being one of the current issues for the already veteran company, resulting in a huge loss of sales. and therefore money.
